Mopar CEO Pietro Gorlier on corporate and dealer service (part II)

As a manufacturer, if we increase our requirements (as we did) — because I want to be sure that every time there is a car there is the perfect technician, fully trained, etc., I know that I increase my quality of service — I'm also creating a significant problem in the management of the dealer.

The debate sometimes with the dealers is, “If I have a master technician, shouldn’t you trust that master technician is able to control all the repairs even with a more junior technician?” How much should I trust more that the dealer is managing fine the process, or do I need to be prescriptive? Finding that balance between being prescriptive and using the common good sense is going to be an exercise that we do every day. But when you have a large network of 2,500 dealers, you need to have standards.

If you go to your dealer, Teterboro, or you go to Golling in Michigan, or you go to Fields in Illinois, we like to think that you find always the same optimal experience, the same well-trained technicians, etc. But it’s not always. So you need to keep adjusting. It’s a continuum. But it’s true for every business.

... and at Apple, there are customers going in with an out-of-warranty part, and having them say, “Wee’ll just replace whatever needs to be replaced because it’s only a month out of warranty.”

Then you get a very interesting question, because obviously I get a lot of letters sometimes. I mean the car was just out of warranty for 1,000 miles or two miles. I mean, “It’s unfair. The transmission should last forever.” Then you go through the debate and say okay, we should pay everything. I remember a guy, a high executive of another American manufacturer, during an automotive congress, said “I received a complaint, it was not fair to pay, but there are moments where you need to step in.”

It was a problem, “I lost my job. I had this ten year old car, etc.” I could pay. But what about the customer that didn’t call me? I mean, with the same conditions. I always think that you need to be also consistent and fair.

It is the real problem in customer care. You need to understand what is right, and the bit that is right is complicated. And the more you go up into the realization, and the more you have the propension to pay. Sometimes my team is challenged and say “Listen, the guy is not right. It was misuse of the car.” Sometimes it’s hard.

I've heard those stories too. In the days of the four-speed automatics, I would hear, “Chrysler makes these awful transmissions these days. They fail immediately.” My first question was always, “Did you just change the fluid in it?” One time, a guy said “Yes.” I said “What fluid did you use?” He had put power steering fluid in because that’s what he’d always done. I thought, and told him, Chrysler was perfectly right to void the warranty.

The best is when they write us and say “I took the car into a highly specialized shop that I know next to where I live and they told me . . .” So they went with a problem to, say, Joe’s Repair on the corner. Then they tell you they had the maximum [estimate?]. Take it into our dealership and we’ll see.

I think for most people, is if it’s a known problem, like the brakes on the 2008 minivan, that you knew was an issue and replaced them. I think people hold that in one hand. But if you have something that normally does work very well and for one person suddenly fails outside warranty, people understand that.

Oh, I know. That obviously is an important element in every decision. We know we have a component – that’s the case of the brakes, for instance. We knew those brakes were lasting not at the same level of other brakes. So one day we said, “Okay, let’s pay.” And we paid them, whoever was calling and saying they had a problem with the brakes, and said “Okay. We recognize it. Send us the bill.”

At my own dealership, I’d like to have Express Lane, but they may not have room for that.

Yes, New Jersey is a tough field. One of the biggest dealers that we have in New Jersey is making a renovation, but they are packed. It’s very tough to expand.

When you have got a lot of existing customers how do you rebuild?

The answer is that they need top mechanics to provide service, and they are not willing to work weekends — and it’s hard to find and keep such mechanics regardless.

The second question for your dealer is what are your hours of operation? Are you open a full day on Saturday? Why you don’t work two or three shifts? So before getting to the point of opening – I mean, expanding a little more, there are many different steps you can do to expand your capacity.

That is true. And Sunday hours are illegal in our county.

Yes, but you can work up to midnight.

It’s just the mentality. Some of the dealers tell me “I'm going to lose my service manager because he has been there for 30 years. He doesn’t want to work on Saturday.”

What do they do when they don’t work aside from stay at home? They go to the malls. They go to the restaurants. They go to McCormick Place [the interview locale in Chicago]. They go to the football match that is full of people selling tickets, selling beer and popcorn.

People are working on Saturday. Particularly in the US. In that sense, it’s one of the most advanced markets. There are ways just to build the process.

I'm not saying people have to work seven days a week, 24/7. You can do some type of work overnight or something. We have plants that are working 24/7. A large part of our plants. At the end of the day, you get new people.

A different dealer said they were talking about how sometimes when there’s a warranty replacement part, like the early Pentastar heads, where cars were being built with the new heads but customers were waiting with their vehicles out of service because they didn’t have parts.

We went through that problem for two or three months, and because we didn’t have a clear understanding of how many heads we needed. Once we realized that it was a level of replacement, we increased yield.

We manage our familiar part numbers. I mean, this is an important part.

You can’t just take a piece from production. I mean production gets engines, right? Not heads. So you need to go into the process at the beginning, but collecting the parts in the form or way we need them for service, that is not necessarily the same form. So sometimes it happens.

We have a clear rule that as soon as we understand there is a customer issue, that is the priority in production. So as a guideline, that’s the process: do we make sometimes mistakes? Yes, it happens. That lasted a couple of months. The reality is we didn’t have a clear understanding of what was exactly . . . we found there were some dealers that were replacing heads that had not to be replaced. So that inflated our demand. There may have been some legitimate needs that were not spoken. I'm surprised if you have a dealer having that problem today. If you have, tell the dealer to present me a mail because as far as I know we have all the heads that they need.

That particular problem and part...

Generally speaking. It may happen. We have 500,000 parts. I can show you every day a list of parts that we’re trying to conserve. But if you have a dealer that has a problem of heads or something like that, it’s important [for them] to mention it to you. Give them my email . . . every month I write to every dealer in the US or something and it’s called the Mopar Momentum, so they know that they can write back to me. Some of them, they do when they have a problem. Though it’s always a defeat if they have to write to me, because it means the field hasn’t been able to fix their problem.

On the other end, it’s better to know about the problem and be able to fix the process.

Oh, yes, I don’t escape problems. The more problems I have, the more chances I have to fix them.

Moving on, what do you want Allpar to do for you and Mopar?

As I told you, when you came in, I told you that I always appreciate these interviews because you come with very detailed questions, although they sometimes may be challenging for us. Or not challenging, but you ask questions that sometimes are driven by things that you've heard or you've collected in the field, and so these are problems . . . it’s easier when you tell your story, to just tell all the things you want to do.

We’d like to know, what is the market perception or feeling? One of the secrets of our recipe is that we have been always open to listen to what customers have to tell us, whether it is in terms of what is the experience that they have or what they want.

For instance, when you talk about accessories, that is an important part of our business. Listening, going to SEMA, customers will ask — for instance, with vintage cars, we’re working to try to have a better program for people that want to put a new, recent engine in an old car, that has been one of the top requests. So I've got an engine; we’ve got a controller; we’ve got a transmission that I can drop into a car and go faster, right?

These are all things that we’ve been listening to from customers. Reading what you write is always an opportunity to learn something, whether it is because you ask or because you criticize something that we don’t have.

It’s always an opportunity for us to improve. You collect questions or opinions from the dealers, — we have kept a very open channel with the National Dealer Council and the dealers, because at the end of the day they are our face with the customers. We normally come into play when there is a problem. I’ll say keep on bringing these questions.